Forward (or Backward) to Etatism

“We want a society where people are free to make choices, to make mistakes, to be generous and compassionate. This is what we mean by a moral society; not a society where the State is responsible for everything, and no one is responsible for the State”.
Margaret Thatcher

Etatism (French, from état, meaning state; or in English, statism) means the concentration of economic control and planning in the hands of a highly centralized government, often extending to government ownership of industry. The more powers, functions and mechanisms concentrated in the hands of a government, the more etatistic its policy with the people more restricted by, and subordinated to, the government. And vice versa, in a country where the government has very few functions, people live, act, study and work more freely.

To illustrate this notion one can use, for example, one of most popular ideological quizzes as published on American libertarian websites since the late 20th century (www.theadvocates.org):

The lower left hand side of the diamond shows a scale measuring personal liberties, whilst the lower right hand side features a scale measuring economic liberties. Consequently, when taking this quiz, the more positive answers you give to questions about personal liberties the more left-leaning you are, whereas when doing the same to questions about economic liberties, you are a supporter of a rightist ideology. Those who give positive answers to all or the majority of the questions in both categories are libertarians, whereas those doing the opposite, i.e. giving mostly negative answers, are etatists.

In terms of political ideologies, those who find themselves in the left hand section of the diamond are supporters of left-wing political parties, such as socialists, social-democrats, laborites, et cetera; those in the lower right hand section of the diamond are advocates of conservative parties, such as the Conservative Party of Britain, or the US Republican Party; finding oneself in the section at the top of the diamond means supporting libertarian parties, for example, the US Libertarian Party and so-called Tea Party. Appearing in the bottom section of the diamond means favoring all sorts of totalitarian parties, like the Nazis were in Germany, the fascists in Italy, or the communists in the Soviet Union.

Readers can themselves attempt to define which direction the wind of Georgian government policy blows. To test which political ideology one’s opinions belong to, one must be prepared for serious philosophical pondering over such an issue as, for example, phone tapping. To take a clear stance on what at first glance is a simple issue, we need to figure out where the line between security and protection of personal information runs. As a rule, this issue (along with the issue of the prohibition of abortion) is one of main distinguishing features between leftists and rightists.

I think there are many signs indicating that the Georgian government is, unfortunately, heading towards the bottom section of the diamond, at least away from the right hand section. To illustrate this contention, I will list several etatist ideas and actions:

- The establishment of universal state health insurance – and, especially, state funds – force people to entrust money to a monopolist government and thus become permanently dependent on it. There is a simple alternative to that – a decrease in tax rates by at least that portion that the government now uses to cover health care costs. Individuals, who will find more resources in their hands as a result of tax cuts, will themselves control how to spend them; they will also take responsibility for choosing their own doctors and hospitals. Any attempt to impose state control on medications will end up in the creation of shadow markets, lobbyism, monopolism, corruption and high prices. (I have personally explained the risks associated with that to many politicians).

Just recently, the Health Care Ministry has targeted the dental sector. It has openly stated that this sphere lacks regulation and the government thus decided that things must immediately be “put to right.” For example, dentist clinics are now required to have an office space of at least 14 square meters per patient and to arrange entrances with wheelchair ramps for physically handicapped people.

Introducing such stupid regulations is not a novelty. For example, currency exchange booths are also required to have adequate space and even a calculator. However, in case of dentist clinics the problem is simpler. Any patient, no matter how low his/her income, would like to be served in a better clinic, in a clean and pretty office, and would probably prefer that office to be larger in size. As regards wheelchair ramps, I would like to tell our fascist-resembling bureaucrats that no dentist clinic wants to lose a patient because of the absence of wheelchair ramps, whereas ordinary people will assist disabled people even without your bureaucratic support.

Some government representatives may sincerely believe that they started a very generous undertaking by financing universal state health insurance. Let me say for their ears that this very decision was a crime, especially towards future generations. One can hardly imagine anyone showing enough courage to abolish it in the future, regardless of whether he/she understands the clear totalitarian nature of this universalism (the word totalitarian means a form of universal, all-encompassing management) or whether the country has become mired in debt.

Moreover, the Georgian government fed naïve impoverished people fairytales about state programs being frustrated by private insurance companies wasting financial resources.

- Similarly etatist was the decision of the Education Ministry to place the printing of textbooks under its control. To the same naïve people, this move was explained by stories of textbook prices being pushed up by private companies and the need to assist the population. In reality, however, this move will sooner or later lead (whether willingly or not) to the maximum control of the education process by the state.

The decision to broaden the “free” sector in universities simply does not hold water and serves populist passions alone. This “free cheese in a mousetrap” will cost the country very dear and our labor resources will not become competitive for quite a long time. This, in turn, will scare away investments.

- Amendments to the Labor Code that restrict an employer – a purchaser of labor – from purchasing that labor which he/she deems most useful. Any sort of propaganda that ownership, which was not properly protected before, is better protected now directly clashes with (for example) the Labor Code – owners are prohibited from using their own resources to pay for what they want. (If the government recalls the example of the European Union, they will produce a good argument – it is a fact that unemployment there is higher in those countries where labor is more regulated).

- State controls on food safety cancel the rights and choices of people, replacing them with the monopolistic rights and responsibilities of a bureaucracy that has no motivation to perform the job of food safety control well. There is no ground or historical precedent to trust bureaucracy so much. Especially taking into account that this control limits choice and, consequently, the use of private property. Food inspected by the government will create the illusion of safety and cancel the motivation of people, under their own responsibility, to personally double check quality. This is no less dangerous than the food products not being inspected by the state.

- Measures to protect the economy known as the policy of protectionism. This perversion is intended for the protection of certain businesses to the detriment of customers’ interests. The situation here is even simpler – any customs duty that is imposed on imported goods will be paid by the customers. Without open borders, competition prices on Georgian produced goods will never be lower than those of imported goods.

- Toughening immigration laws, which turn Georgia into a non-friendly state. Perhaps it is worth publishing the information about the countries with the strictest immigration laws in the world – these are also the most authoritarian countries. Restrictions are also imposed in many Western countries, but, in the case of the European Union, for example, the main idea behind its creation implied the abolishment of such restrictions and it now has a visa free travel regime with dozens of other countries. Because of unsubstantiated fear and arrogance, we must not restrict, but become friends with, those people who arrive here to study or work. The popular legend in Russia that Georgian citizens assist Georgia from there misses one fact – Georgians living there create wealth in Russia and send only a small portion of that to Georgia; likewise, foreigners working in Georgia, first and foremost, assist us in creating wealth.

- Restricting land ownership by foreign citizens. Just imagine that you, readers, are treated similarly abroad; why should anyone trust us if we treat them like that? The methods of such propaganda and restricting the rights of foreigners to own land are common in totalitarian countries.

Other similar actions of late include: the competition agency with investigative functions being subordinated to the prime minister; a financial monitoring office similarly subordinated; a plan to create a state bank; the creation of a government pension savings fund…. It is good that we do not read all laws, thus sparing ourselves from becoming more frightened. Apart from ideological problems and the clear trend of enhanced state control, which can be seen from the issues discussed here, there are numerous other issues that we have repeatedly emphasized. Such regulatory institutes require a perfectly operational democracy, openness and transparency, and the will of the people to control the government’s activities and hold it accountable for its deeds.

Regulation either comes from the market – where millions of customers make choices on a daily basis and nudge suppliers towards best practices; or from the state – where, instead of being made by millions of people, decisions must necessarily be taken by individuals with ideal moral qualities and the highest qualifications. Is there anyone who does not understand that this is dangerous?

Questions emerge themselves: Where are we heading for? Why does the government try to control our lives? Is this what they call the reinstatement of justice? For whom is justice reinstated? Is it being reinstated so that their powers are enhanced? Readers must know that totalitarianism stems precisely from this – when the government becomes the all-encompassing controller of everything because of our own irresponsibility. If we look closely at the history of mankind we will see that the idea of the reinstatement of justice also has often ended in attempts to impose totalitarian control.

It is very likely that one day all this will fall apart. We will be short of economic resources and international institutions will reprimand us (for protectionism, for example). That such totalitarian institutions do not have a future is something that the governments of all developed countries know perfectly well. However, the economic obligations created by them are already so huge that rejecting them is politically very disadvantageous. Unfortunately, we are very rapidly heading towards an abyss which promises continuous economic stagnation. However, we had the chance to become a very free country, one highly attractive for investments, with state functions and obligations contained within reliable boundaries.

Last but not least, I do not think that everyone in the government dreams about etatism. In many cases, they lack the sufficient information, knowledge and experience to predict results; often political competition forces them to ensure the population that they are not dodging responsibility. However, here we are dealing with at least one grave mistake. Even if we believe that we have the best people in government who will not allow this etatist policy to degrade into totalitarianism, they will not be in power forever and the wrong institutions bequeathed by them may subsequently fall into the hands of the wrong people.

Concessions made at the account of restricting our personal freedom cannot be justified by short-term political benefits; they lead us towards an immoral system in which people get used to leading a parasitic life on someone else’s account and become totally dependent on the government.

“It is seldom that liberty of any kind is lost all at once”.
David Hume